Otter Tail Corporation (OTTR)

Return on equity (ROE)

		Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Net income	US$ in thousands	294,191	284,184	176,769	95,851	86,847
Total stockholders’ equity	US$ in thousands	1,443,010	1,217,320	990,777	870,966	781,482
ROE		20.39%	23.35%	17.84%	11.01%	11.11%

December 31, 2023 calculation

ROE = Net income ÷ Total stockholders’ equity
= $294,191K ÷ $1,443,010K
= 20.39%

The return on equity (ROE) of Otter Tail Corporation has varied over the past five years. The ROE was 20.39% at the end of 2023, showing a decrease from 23.35% in 2022 but an increase from 17.84% in 2021. This suggests that the company's profitability in generating returns for its shareholders slightly declined in 2023 compared to the previous year but remained relatively strong.

Furthermore, the ROE has shown an overall positive trend since 2019 when it was 11.11%, indicating that Otter Tail Corporation has been improving its efficiency in generating profits with the shareholders' equity over the years. This trend implies that the company has been effectively utilizing its shareholders' investments to generate higher returns.

It is essential for stakeholders to monitor the ROE closely as it provides insights into the company's profitability and efficiency in utilizing shareholder funds. It is also important to investigate the factors influencing the changes in ROE to assess the company's financial performance accurately.